Icade (ICAD) Earnings Call Transcript & Summary

I would first like to say how pleased I am to be addressing you today albeit remotely. This full year results are an opportunity for me to recognize Icade's strong performance in 2021, which was better than we had even expected. In a complex environment with a crisis that is still ongoing, our 3 divisions have managed to do well. As regards Office Property Investment, I have full confidence in our ability to develop our solutions and adapt to changes in the market. As far as Property Development is concerned, as you will see in a moment, everything is looking good for its continued expansion. Lastly, Icade Santé has also continued to expand at the expected pace. I feel it's important to emphasize the very high quality and diversity of its portfolio with first-time investment made in acute care and ongoing international expansion in 2021. As such, we will further implement our strategic plan and continue along the roadmaps in place for our business lines. We have also reaffirmed our priorities for the coming years. Among these priorities, I would like to highlight our low-carbon strategy and societal commitment recognized by our stakeholders. In particular, the magazine Le Point, which recently ranked Icade as the most responsible French company for all industry sectors combined. This is also an opportunity for me to reaffirm that the Board of Directors and Icade management are perfectly aligned. And we as a responsible and committed real estate company, have integrated our purpose into operations. I would like to thank Icade's employees. The results that Olivier and Victoire will present to you in a moment will not be possible without the constant efforts and determination and rigor. I'll now turn it over to Olivier Wigniolle, CEO of Icade.

Thank you. Thank you, Frederic. It was a video of Frederic Thomas, our Chairman. So good morning, everyone, and thank you for being with us this morning, and welcome to [ Appen ] our headquarters. So it's always a real pleasure to see you in person and welcome also to those that are beyond the screen in Paris, London or Amsterdam. Unfortunately, not in New York, it's a bit too early. So I'm with Victoire Aubry, our CFO. And after our presentation, as usual, we will have a Q&A session with the entire Executive Committee of Icade. So please do not hesitate to send question by e-mail or by phone and even during the presentation. So our meeting this morning is dedicated to our 2021 results and outlook for 2022. So in terms, just to start, in terms of overall context, I think some very good news since last November regarding the COVID-19 crisis, which is now more or less behind us. The sanitary situation is stabilized in France, and the situation on our different markets is getting back to normal. And just as an example, we have now most of the people that are clearly back to the office building. So let's start on Slide 6. So maybe before to, jumping into figures, let me start by introducing briefly 3 new elements that we have in this presentation on Slide 6. For the first one, our 2021 results have been prepared for the first time using the fair value accounting method versus the historical cost method. So Icade accounts are now presented like any other REITs, and Victoire will provide more insight on accounting impact in a few minutes. So second, we've had, and it was a request sometime quite direct from some of you. So on top of the IFRS accounts, we have had a group share P&L, which give maybe a better economic view of our accounts and activities. IFRS financial statement as well as a reconciliation table are of course also available. And the third element is the hot accounting topic of the moment, the European taxonomy. So we do release for the first time the reporting on this limited in 2022 to the eligible activities. Again, Victoire will also come back to that. So our results now. I'm on Slide 7. So our result for 2021 have risen sharply. So the current net cash flow increased by plus 8.8%, up to EUR 390 million, back to level of 2029 (sic) [ 2019 ]. And on a per share basis, it stood at EUR 5.19, a plus 7.2% growth, well above our last guidance that was at plus 5%. Our EPRA NAV NDV stood at EUR 6.9 billion, plus 8.6% compared to the end of 2020, and it represents EUR 90.6 per share, plus 6.1%. So this figure at the end represent a double-digit total shareholder return for 2021, plus 11%. Here, again, Icade is back to pre-crisis level of performance. On Slide 9 now. The Slide 9 present the other main result figures and KPIs. I won't comment them extensively as Victoire will come back to them in a few minutes. But just a word, the good performance on both net current cash flow and NAV are the result of a solid business performance across our 3 different business line. So in terms of gross rental income, total rents increased by plus 2.9% to EUR 551 million. And we have a solid prior earnings of EUR 4.81 per share, which is a growth of plus 1.4%. Regarding portfolio valuation, it stand at group share at EUR 12.2 billion, a strong 2.8% (sic) [ 3.8% ] growth and 0.7% like-for-like growth, reflecting strong and positive activities and evolution both in Healthcare and Offices. Our financial occupancy rate for the Office portfolio stand at 88.1%. This is a decline, but mainly due to disposal of mature and fully let asset combined with the completion of promising new office building. For Icade Promotion, our development subsidiary, the rebound is clearly there. Revenues amount to EUR 935 million, up 32% compared to 2020. And maybe more important, it's a double-digit growth compared to 2019. So on Slide 10 and 11. Those 2 slides are summarizing our main achievement in 2021. And as we will go into the detail, I won't comment then to slide. But I think it's really fair to say that Icade has been more than active in 2021, not to say successful. So let's go directly to Slide 14. So regarding our Office portfolio, 2021 has been definitely a record year in terms of leasing activity, with 266,000 square meters newly signed or renewed. On top of that, the new lease space coming from the acquisition that we made last year represent another 78,000 square meters. So again, it's for Icade a record year. This volume, which is well above our 5-years average allows us to secure more than EUR 72 million of rents for an additional 6 years on average. And this represents 17% of the total annual rental income of the Office division. In the context of a recovering rental market, this level of letting transaction demonstrates our ability to maintain and also to attract new tenants, notably in our large and brand-new office building such as Edenn or Fresk. Edenn and Fresk are 2 of our development projects of our pipeline that one of them has been delivered last year, and one of them is to be built. On the right-hand side of the slide, the 2 top figures are reflecting the solidity of our rental office portfolio. Just to remind you that 72% of our tenants are large corporates, listed companies or public agencies. And our rent collection rate was really high in 2021 at 99%. So clearly, the situation after 2020 is back to normal. Now moving to Slide 15. So a few words now on our office development pipeline, which is still a very strong driver for value creation. And look, what we have achieved in 2021. We have completed 4 office schemes, representing more than 115,000 square meters. And this include Origine, the new headquarter of Technip Energies, nearly 65 square meters of office space in Nanterre, a very attractive and dynamic location. West Park 4 also located in Nanterre and fully let to Groupama. The new Latécoère headquarters, 13,000 square meters office building in Toulouse, fully let as well. And Fresk, completed in September and already pre-let at 67% to the public agency [ Pari Sante Confis ]. Those 4 major projects represent a total value creation of EUR 232 million, of which EUR 100 million have been generated and booked in 2021. And the equity internal rate of return for those 4 projects stand at 15.2%. So new office development scheme is a risky business, for sure, but well-managed. And Icade, I think, has a track record for this. Financial results are really appealing. Fair to say also that this completion have a short-term negative impact on our financial occupancy rate, but we are really confident in our capacity to finalize the marketing in 2022. In the same time, we do prepare the future, and we have launched 5 new projects in 2021. Those 5 new projects represent an investment of EUR 450 million and a potential of value creation of EUR 100 million. So you have the detail project by project in the appendix of the slide show. So clearly, development projects for office building remain the best way to create value in the Office segment, and it's our DNA at Icade. So what about asset rotation within the portfolio. Asset rotation is also part of our DNA. So with the volume of disposal of more than EUR 500 million last year, EUR 507 million of mature assets in very good financial condition, as well as EUR 243 million of value-add acquisition, 2021 was clearly a very active year in terms of asset rotation within the office portfolio. And those disposal illustrate also the strong liquidity in the market for good and mature office building. And with the 2 opportunistic acquisition for EUR 243 million, again, we do prepare new promising and attractive future development on top of those that we have already in our pipeline. As a reminder, we target an annual average volume of disposal of EUR 500 million to EUR 600 million. And the 2022 disposal plan is already well on track. Icade has signed last December a preliminary agreement with a leading institutional investor to sell the Millénaire 4 building located in the Millénaire business park for an amount of EUR 186 million. And with this transaction, after the sale of Millénaire 1 building in April 2021, the disposal of Millénaire 2 and Millénaire 3 buildings in recent year, Icade will have completed the entire redevelopment of the Phase 1 of the Millénaire business park. And I think we have demonstrated our ability to create value by converting our land bank. If you look at Millénaire, the total value creation deriving from the disposal of the 4 Millénaire building amount to EUR 235 million -- EUR 265 million with a double-digit equity rate of return. On Slide 16, now to comment on the valuation of the office portfolio. So the value of our office portfolio stand at the end of December 2021 at EUR 8.3 billion on group share, which is minus 1.7% change on a reported basis. And the main changes are the significant volume of disposal, offset by EUR 400 million of investment, acquisition and the development CapEx. The slight decrease on a like-for-like basis, minus 1%, reflects the more cautious appraiser assumption on reletting and marketing processes. In terms of the market cap rates, their assumption that they are more or less stable in 2021. So the portfolio valuation reflect also, in particular, a very good performance in the valuation of our assets located in Nanterre, just behind La Défense, plus 4% on a like-for-like basis, but also in regional cities plus 4% on a like-for-like basis and also for the labs and small businesses premises of our business park, particularly in Rungis with plus 11% in terms of valuation like-for-like. Let's now move on slide -- sorry, the other way. On Slide 18, on the Healthcare division. So our gross rental income amounted in 2021 to EUR 188.4 million on a group share basis, up by plus 8.2%. So the growth is mainly driven by acquisition made in the second half of 2020 and in 2021, both in France and in Europe. In 2021, acute and post-acute care contributed 86% of total Healthcare rental income. And we continue to benefit from a very solid portfolio of tenants that are long-term committed in our assets. And we have also pursued the diversification, both in terms of tenants with 4 new best-in-class tenant. And in terms of geography, with 2 new countries, Spain and Portugal. And the average lease break is now 8.2 years, nearly up 1 year, supported by significant renewals in 2021 and by the occupancy rate, which is still at 100%. Actually, we have renewed 21 leases, which represent EUR 55 million in headline rental income, with a positive impact both on the weighted average lease break and also on valuation. As a reminder, in 2021, we have renewed 10 leases in France in one of our most important tenants, Ramsay Santé. Lease is renewed for another additional 12 years. Our international portfolio doubled in 2021 and now contributes 14% to gross asset value. And this is the result of our strong investment activity last year. And if you look at Slide 19, regarding the investment activity of our Healthcare division, growth of the portfolio has been very strong in 2021. And Xavier and the team have made, I think, a fantastic job on that. With a volume of investment of EUR 910 million in 2021, we are clearly ahead of our initial target with more than 60% were invested abroad and close to 60% in acute care and post-acute care facilities. And with the entry, as I said, into Spain and at the beginning of 2021 and into Portugal at the end of December, we are now present in the 5 most important markets in the eurozone, France, Germany, Italy, Spain and Portugal. And another interesting fact, we have invested for the first time in acute care, aboard, namely in Italy and Portugal. The acquisition of 4 private hospitals in Italy for EUR 85 million and 4 private hospital in Portugal for EUR 213 million. So as you remember, we tried last September to list Icade Santé in order to support and to finance our growth strategy. So although the interest was strong with -- for the record, close to EUR 700 million of allocable demand at EUR 115 per share, a price that represented a plus 25% premium on NAV. The market window that we choose at the end of September turnout to be the wrong one, and we decided to postpone the IPO. I will come back to that later. But even without the fresh equity coming from new investor, we decided with our partners to confirm our growth ambition. And Icade Santé delivers, has delivered and will continue to deliver, I think, in a very disciplined way its ambitious growth roadmap. And we have already completed nearly 30% of our EUR 3 billion investment plan. So clearly, in our view, Icade Santé is becoming day after day, transaction after transaction, the leading European platform for health care real estate. Now on Slide 20. So a few comments on the valuation of the health care portfolio. The valuation of health care portfolio amount to EUR 3.9 billion group share, EUR 6.7 billion on a 100% basis. So this is by far the largest portfolio in Europe. It's an increase of plus 18% on a reported basis, and up plus 5% on a like-for-like basis. And this like-for-like evolution represents an average yield completion of 30 bps. This cap rate compression reflects the liquidity and the very strong appetite for the asset class. And with a 5% average net initial yield, my view is that external appraisals are still quite conservative on the valuation of our portfolio. Let's move now to Slide 22 for our third business slide, Property Development with Icade Promotion. Emmanuel and his team has also done a very good job. And Icade Promotion did very well and clearly outperformed the market in 2021. Some figures to illustrate the excellent business momentum in 2021. So the economic revenue amounts to EUR 1.1 billion, which is plus 30% compared to 2020, and maybe more interesting, plus 11% compared to 2019 before the COVID-19 crisis. So it is mainly driven by the residential segment with more than 6,000 new orders for residential apartments, which is a record year for Icade Promotion, plus 18% compared to 2019. 58 new residential schemes were launched in 2021, representing more than 2,800 units, which is an increase by plus 13% compared to 2019. So the good momentum is also there for the Office segment with the volume of new office sales agreements more than tripling in 2021. And this represented a total turnover of EUR 450 million (sic) [ EUR 460 million, ] an amount which is partly recognized in 2021, but will be also recognized over the next 2 years. So they are on Slide 23. Clearly the strong performance is supported by a growing demand for residential. But it has also been made possible thanks to the growing supply and our ability to renew our stock faster than the market. So few KPIs on that. So the controlled land portfolio increased by 31% and represent at the end of December 2021 more than 15,000 units or about 2.5 years of activity. The number of building permits continue to grow, and is up plus 39% compared to 2019, clearly, significantly outperforming the market. And finally, the housing part of the market for sale is also posting a double-digit growth compared to 2019 compared also to a downward market trend. So Icade Promotion is clearly currently gaining market share. On Slide 24, I think the midterm future for Icade Promotion is also clearly positive. The forward KPI are strongly up, confirming the growth potential for Icade Promotion. The medium-term revenue potential for Icade Promotion amount to EUR 7.6 billion, and it includes a backlog, up plus 20% at EUR 1.7 billion and a controlled residential land portfolio, representing EUR 2.7 billion of revenue. Last focus I want to highlight, it's our new offer AfterWork. AfterWork is a division of Icade Promotion dedicated to the redevelopment of assets, and in particular to the transformation of offices or hotel into a housing scheme. And the potential is in our view, very significant. And Icade Promotion has already launched 2 very appealing projects. Some example, a restructuration project in Paris for the redevelopment of 4,500 square meters of office into a business school. And in Neuilly, Neuilly is a [indiscernible] neighborhood of west of Paris, the conversion of a hotel that was very impacted by the COVID-19 crisis into 164 apartment residential schemes. So all the indicators of Icade Promotion are well-oriented, and we are really confident in our capacity to reach our target for 2025, which is a revenue of around EUR 1.4 billion and a margin close to 7%. I'm now handing over to Victoire for the detailed financial results. Victoire, the floor is yours.

Thank you, Olivier, and hello, everyone group. First of all, let me tell you I'm more than happy to all this presentation in person. And I'm also looking forward to face-to-face meetings on the occasion of the roadshow. First of all, as Olivier mentioned, 2 changes, not to say improvements, were made in 2021 in the financial presentation. First, we decided to change the accounting method for the valuation of investment properties to the fair value method instead of historical costs previously. 2 things to take away from this change. First, no impact on prior indicators. Secondly, the change in fair value of assets goes now through IFRS P&L positively or negatively instead of depreciation only before. You have all the reconciliation tables of the restated 2020 accounts in the notes of the consolidated financial statements available on the website. We also opted in 2021 for an economic presentation of the P&L with all the P&L indicators presented in group share, which consists in taking into account all the entities for Icade proportionate stake. While the cash flow, NAV and the NAV were already presented group share, this new presentation mainly impacts the revenue KPIs. It is intended to better-reflect the economic contribution of each business unit, starting with the top line of the P&L. This new presentation comes in addition of the IFRS accounts which remain obviously unchanged. All the reconciliation tables are available in the appendices of the press release starting Page 57. Notice that we will also continue to communicate on economic revenues for the development property division, particularly for the purpose of alignment with our peers. After those technical remarks back to our '21 results. And as Olivier said in his opening, sorry, they are very solid. Let's go into details of the income statement of our different divisions, starting with a focus of Property Investment business lines. I'm on Page 28. We are talking here about both Office and Healthcare Property Investment divisions. The key message here is EPRA earnings for those divisions stood at EUR 361 million, up nearly plus 3%. This reflect a good performance, notably the very good momentum in rental income, but also good cost control in the context of recovery post sanitary crisis, and last but not least a continuing improvement in the cost of debt. Thus, total rental income group share grew by almost 3% to EUR 551 million. The gross rent and income ratio remain at strong and stable 95%. EPRA cost ratio, excluding vacancy stood at 12.6%, one of the most attractive level in the sector and especially reflecting the strong cost of control management of Icade. EPRA earnings is also boosted by the improvement of financial cost over the period, the decrease in price effect offsetting the slight increased volume effect. Per share, EPRA earnings from property investment represent an increase of 1.4% to EUR 4.74, lower growth than in absolute term, mainly due to the effect of the scrip dividend in 2021. Last comment on this page, you have a well-balanced P&L here with a contribution from the Healthcare division continuing to grow at 42% and a solid 58% from the office division. Let's jump on Slide 29 to shows the performance by activity. First, the financial result of the Office Investment division remained resilient and solid in a context of significant disposal. The gross rental income for office and business park grew by 1.2% to EUR 344 million, reflecting the dynamic asset management activity with a record year in terms of new leases and renewals, as Olivier mentioned just before, a good illustration of attractivity of our assets in the current market, the significant completion during the period and also the impact of the opportunistic acquisition. Net to gross ratio is slightly down mainly due to the sale of fully let assets as well as new completion part of which still being marketed. In addition, taking into account, as I said before, good management costs under improvement on the financial cost, the EPRA earnings on office and business park increased by plus 2.7%, reflecting strong performance of the division in a post-COVID environment. Now in term of Healthcare Investment division, all the indicators are well positioned and reflects the continued momentum and even strong growth on this asset class. Gross rental income grew by 8.2%, stimulated by our expansion in France and abroad with net rental income reflecting a high net gross rent and income ratio above 98%. Taking into account the positive impact of the strong management of operational and financial costs, we have a double-digit growth in EPRA earnings, plus 10.3%, to EUR 151 million. To recap, our investment activities have remained dynamic, thanks to a very resilient activity of our office investment division and continuing growing performance of our Healthcare Investment one. Back to my 4 comment of the beginning of my presentation, notice the gross rental income is presented here on a group share basis, the P&L presentation on a 100% basis as presented previously is provided in the appendices of this slide deck. Let's now switch to the result of our property development activities, the third business line of the group. I'm on Slide 30. The rebound is there and is reflected in our results through very strong financial KPIs. Economic revenues grew by 30% to EUR 1.1 billion, a plus 11% growth compared to 2019, reflecting a very solid business momentum. Revenue from residential segment rose by 32% to EUR 911 million, that represents 85% of the total activity. This segment is particularly supported by strong demand from both individuals back to the market in 2021 and continuing strong institutional investor appetite that represented 55% of the total revenues in 2021. It is also of course thanks to the good commercial performance of the Icade Promotion teams. I also want to highlight that we improved our operating margin at 5% on average, supported obviously by higher volume and also by an appropriate management of higher construction costs, the key challenge so far today in this sector. And how, by implementing a rigorous purchasing policy, but also the management of the sales prices. Net current cash flow contributes to the total for EUR 24 million. I remind you, it stood at EUR 2.5 million in 2020 due to the construction shutdown. To conclude on that activity and on the back of a sector that remains structurally supported by a strong demand, the impact of the crisis has been removed, and we are ready to continue to improve the development division's performance, fully in line with our 2025 ambitious road map. To resume what are now the key point regarding the group, net current cash flow. I'm on Page 31. Net current cash flow sharply increased by nearly 9% to EUR 390 million, slightly above 2019 level. This growth is obviously driven by the performance of our 3 business lines, as I just commented, but also noticed the acceleration of the positive impact coming from the rebound of Icade Promotion with a positive contribution in total current cash flow 6% in 2021 compared to the last year. On a per share basis, this represents an increase of 7.2% to EUR 5.19, well above the guidance of plus EUR 5. And the reasons are threefold, first, stronger resilience in offices; secondly, better performance for Icade Promotion confirmed at year-end; and at last -- and last, the postponement of the IPO of Icade Santé, a said setback on a strategic point of view, but good news on the P&L point of view for Icade because it implied no dilution impact. All business lines contributed to the rebound of the net current cash flow, reflecting in 2021, again, the strength of our diversified model. Turning now to the liability part, with 3 key highlights. I'm on Page 33. First, improvement cost of debt and average maturity. End of December, the cost of debt is even more attractive at 1.29 down again, while average debt maturity is stable nearly 6 year. I highlighted concrete positive impact in the net current cash flow just before. This has been made possible thanks to a dynamic management of liabilities, notably with an attractive issuance beginning 2021, with an historical low coupon at 0.625% for 10 years maturity bonds and also early redemption during the second part, second quarter 2021. Second, we strongly adapted and reinforced the aging profile, thanks notably to maturity extension of derivative instruments at attractive conditions as well as implementation of forward starting swap, also at attractive conditions. An adequate anticipation regarding the current situation. At year-end, the hedging rate represents 97% and is above 85% for the next 3 years. Last, we have continued our effort on sustainable finance and even accelerated in line with our ESG strategy. We set up a new green financing framework in Q4 which allow us to reinforce the part of our sustainable debt instruments. Thus, we had the transformation of EUR 600 million bond issued early 2021 into Green bond. And in addition, Icade issued last January a new EUR 500 million Green bond, bringing the total amount of Green bond outstanding to EUR 1.7 billion. By the way, it was done at very attractive conditions, 8 years, 1% coupon. We are glad that this operation is behind us regarding today's market conditions. All in all, sustainable debt instruments represent 35% of total gross debt. Let's quickly comment on 4 usual metrics that show how solid our debt indicators are. I'm on Page 34. As I said, our average debt maturity is stable around 6 years, and we reached an all-time low point in term of cost of debt at 1.29%, notice that our strong and comfortable aging policy represents 0.13 bps already include this total cost of debt. You can also notice that our LTV ratio is stable at 40% in the context of resilient valuation and continuing growth strategy. I will elaborate on it shortly. Another key KPI to illustrate the soundness of our credit profile, the ICR, it exceeds 6 multiples, once again back to 2018 level, we are more than comfortable. On Slide 35. I would like now to return for a moment to the question of how to finance our growth strategy and elaborate a bit further on the construction of the LTV ratio of Icade. Indeed, when we look at the level of 40% at the group level and breakdown by entity on an accounting perspective, some of you are challenging us regarding the difference between the ratio for the Healthcare Property division at 30% and the remaining one that you are calculating for the rest of Icade turning mechanically higher. Let me elaborate on our management debt based on an economic allocation, a step beyond after what we said during our last Investor Day. First, I remind you that a part of Icade debt is dedicated to finance Icade Santé. Just to give you a figure, it represents for Icade more than EUR 1.2 billion over the last 10 years. Net of the dividend received from the subsidiary, it represents EUR 600 million. After analytical allocation of this part of the debt to the health care business line, you get a much more relevant view of the LTV for Healthcare. It stands higher than 40%, 42% at year-end. Therefore, when we focus on the office division by isolating pure debt related to finance office activity, economic LTV stands at 36.5%. So it clearly represents, in our point of view, a coherent and relevant split of the LTV ratio, in line with the current risk profile of each business line. I hope those explanations are helpful for you. Let's jump on Slide 37. It's present the total portfolio group share and details the growth of the EUR 4 billion to EUR 12.2 billion, mainly driven by Healthcare acquisition. Notice that for offices, we are more than active in reinvesting the proceeds from disposal in the pipeline or opportunistic acquisition. Olivier largely commented on resilient Office valuation and yield compression for Healthcare. Let me remind you that the valuation process at Icade is based on external expertise for the entire portfolio with expert rotation, last one occurred in 2019, and notice and more than 60% of the office portfolio is subject to [indiscernible] expertise. Just before commenting the EPRA NAV and GAV evolution, the Slide 38 provides a breakdown by activity. This slide is a good illustration of the soundness of the model with complementary risk profile. We should be well recognized by the market. Healthcare represents end-of-year 32% of gross asset value and 35% of EPRA NAV NDV, an increased exposure of 2% for both indicators. Notice, the reference of Healthcare combined NAV NDV end of 2021 at EUR 90.1 per share, plus 11% in only 1 year. So Slide 39 present the evolution of our NAV, actually the NAV NDV net disposal value. What to retain from those figures. The strong operational and financial performances we have been commenting since the beginning of the presentation are totally reflected in the growth of nearly 9% to EUR 6.9 billion. Per share, NAV stands at EUR 90.6, plus 6.1%. And to finish with an indicator that really speak to the financial community, the total NDV -- NAV NDV returned at 11%, back to precrisis level. Notice that share price total return stand at 7% and the 5-year average at 9%. Not only net current cash flow, but also company valuation KPIs did well in 2021. Notice that 2 other NAV indicators has also -- are also provided in this slide. Now a word on our dividend policy for the 2021 dividend. The Board of Directors will propose to the Annual General Meeting scheduled for '22 April the payment of a dividend of EUR 4.20 per share, an increase of plus 4.7% compared to last year. The dividend yield is 6.7%, attractive level, but also reflecting a stock price at least impacted in the current context. This amount represents also a conservative payout of 81% of the 2021 net current cash flow. And subject to the approval by the General Meeting of 2022 approval, the dividend will be paid in 2 installments, an interim dividend paid in March and the balance in early January. Finally, notice that no scrip dividend is contemplated so far. Let's jump to another topic, very important topic, ESG policy and improvement. I'm on Page 43. Olivier was talking about concrete result in 2021. First, the reduction in carbon intensity is real and is in all 3 businesses. I remind you that Icade announced in early '21 the acceleration of its low-carbon trajectory with reinforcement objectives for its 3 businesses with concrete targets for each business line. We are implementing the road map and the trend in 2021 is already well oriented. Between 2015 and 2021 and in kilos of CO2 per square meter, this is a decrease of 30% for the office investment activity, ahead of target of minus 45% by 2025, notably on the back of low carbon energy sources, renovation of assets and efficient equipment. For healthcare, it's a decrease of 27% during the period, in line with [indiscernible] certification of new projects delivered and energy efficiency improvement work. Also thanks to the growing part of the nursing home facilities. And for the property development, which is the main carbon impact division for Icade, as you certainly know, this is a decrease of 17% during the period. This has been made possible, thanks to the reduction of energy consumption with more efficient equipment or renewable energy. And also thanks to an increased use of pure sources materials, including timber in the construction proceed. Our new subsidiary, Urbain des Bois, will help us to accelerate. I would like also to highlight the progress made in terms of biodiversity, another key pillar of our CSR strategy. We have got ambitious objective and concrete results in 2021. 100% of business park and 46% of the new buildings have right now a net positive impact on biodiversity. Let's jump on Slide 44. On this slide, we have provided you the main rating, which again this year, place us among the leaders in terms of CSR. In particular, MSCI has revised up its assessments for Icade CSR policy and performance by awarding a AA rating in 2021. Finally, a word that has become unavoidable from now, green European taxonomy. I'm on Slide 45. As you probably know, since this year, the green European taxonomy imposes a reporting dedicated to the eligible activities, reporting, which has to specify the part of revenues, CapEx and OpEx of those eligible activities. First, what is an eligible activity? The European green taxonomy specifies a definition of more than 100 activities, including, of course, real estate, notably construction, renovation and operation of buildings. Without any surprise, all 3 business lines are eligible. After matching the IFRS definition of revenues, CapEx and OpEx, eligible activities contribute therefore nearly for 99% of the total revenue and CapEx. The gap with 100% is explained by the exclusion of the project management activity from the scope by the European taxonomy. And so far, OpEx are nonmaterials regarding a very strict definition of the taxonomy on this KPI. It is the first step of the European taxonomy reporting. Certainly, the easiest. 2022 will be focused on the key subjects, which percentage of aligned activities in term of revenues, CapEx and OpEx regarding very strict and concrete technical criteria defined or to be defined by the taxonomy, next appointment in 1 year. It is for sure a good opportunity to further align financial and extra financial reporting, which will offer a bit of visibility on concrete financial impacts of all ESG strategy. Thank you for your attention. And now I leave the floor to Olivier for the last part of the presentation.

Thank you. Thank you, Victoire. So let's -- let's now look forward, outlook and 2022 priorities. Let's start with the Office division on Slide 47. So quick word on market trends that are very encouraging. Take-up level is picking up with volume expected for 2022 at 2 million square meters and EUR 2.2 million in 2023, according to real estate broker. And those forecasts are in line with the 10-year average for Paris region. In term of investment activity, appetite for liquidity for core and mature assets are still very strong, and offices remain by far the most liquid asset class in France. So the road map for our office portfolio is in our view, crystal clear. It's combining appealing cash flow and value creation. So developments, opportunistic acquisition and asset rotation are key to deliver our road map. Therefore, disposal will be around EUR 500 million to EUR 600 million per year. And our investment plan for the Office division, which combine developments and acquisition will be between EUR 1.5 billion to EUR 1.7 billion between 2022 to 2025. So in the short term, for 2022, priorities are, again, focused on letting and renewal activity, a disposal plan and an opportunistic acquisition and launch of selective new development projects. Few comments on the development pipeline. And you have the detail of the pipeline on Slide 66. So the total pipeline amounts to EUR 1.7 billion. It includes an already launched part for EUR 900 million with an attractive 5.6% yield on cost. And on top, an amount of potential opportunistic projects to be launched as soon as we will have a satisfying prelevel of predicting transaction that we could -- project that we could launch in the near future. So the total value creation embedded in the entire pipeline represents around EUR 400 million. So let's move on health care and to start a few words about what I will call the nursing home controversy in France, that impact the sector, both operators and specialized rates for months now 1 month. So what is the situation for Icade. First, let me remind you that the acute and post-acute care represent 86% of the health care growth rental income of Icade Santé compared to 14% for nursing home. More precisely about the French nursing home perimeter, the one concerned by the allegation. The nursing home owned in France represent for Icade a 3% of the total group gross rental income. And the only nursing operated by ORPEA in France and owned by Icade Santé represents 0.3% of the health care and gross rental income and 0.1% of the total Icade Group rental income. [indiscernible], it represents 2.1% of health care rental income and 1% of the level of the group. Important also to remind some, I think, some key fundamentals. And one of the most important differences between acute care and nursing home in France is probably the level of regulation. Acute care assets are much more regulated and certified than the nursing home sector. And if you look at our portfolio, 99% of our acute care portfolio in France are 35 at the 2 highest level by the France National Authority for Health Care, in French Haute Autorité de Santé. And as there is no real certification by the French sanitary authorities and as Icade Santé is a responsible investor, we have developed for the nursing home sector our own internal rating framework developed with AFNOR and set up in 2020. AFNOR the national French public agency for standards. And this framework includes more than 100 criteria related to resident well-being, quality of life, safety, real estate specification and care. And we use this framework for our acquisition and due diligences in France. And we are currently duplicating the framework for our portfolio outside of France. So what could be the outcome of the controversy? I think it's fair to expect an increase in regulation, maybe comparable to the acute care sector, probably more request for care assistants and nurses in nursing home. And as a reminder, those employees are, for the time being, paid by the French Social Security or public local authorities, not by the operators. And we could also expect more controls and audits, probably also more financial transparency and control on the use of public funding. And probably request for improvement of premises qualities. And in our view, this last topic will impact especially public nursing homes. And looking at our portfolio, we have already premises that are at the best standards of the market. In this context, we do think that specialized rates can play maybe an active role, and let's see what will happen. And to conclude, the sector has been heavily impacted, maybe too much, and will be -- probably continue to be in the short term. But on the mid- and long-term perspective, more regulation, more transparency, higher quality for services are expected. And let's say, like this, we are favorable to that. And probably some opportunities for health care REITs such as Icade Santé will derive from the crisis. In the meantime, we stick to our strategy, to our growth strategy. Market trends are still very strong with solid and noncyclical fundamentals and good investment dynamics. So in terms of road map, as I said, we confirm the growth ambition of EUR 3 billion by 2025, representing an average EUR 600 million per year. And we are clearly underway to European leadership. And as you have seen with more than EUR 900 million achieved in 2021, we are in advance on our investment road map. So our priorities for Icade Santé for 2022 are still the same, growth expansion and continued tenant and geographic diversification. For the liquidity and listing, it will be when market condition will allow. So on Slide 52. For Icade Promotion, the positive market trends are still supported by the very strong demand. And the growth road map for Icade Promotion remain in trend with the EUR 1.4 billion revenue by 2025 and improved margin at 7%. And we are confident in our capacity to deliver this ambitious road map. So Icade Promotion had 3 priorities in 2022, increased revenue, again, [indiscernible] margin compared to 2021 and also accelerate in low carbon contribution -- construction, sorry. So regarding our -- the -- that's the right slide. Regarding the low carbon strategy, Victoire commented on very strong achievement in terms of carbon intensity reduction in 2021. And we are now announcing a further acceleration in favor of the climate in 2022 with reinforce commitment. So those new targets will bring our 3 business lines, aligned with the plus 1.5 degrees trajectory by 2030. So for Offices, we are now targeting by the end of 2030, 60% reduction, with 30% for Healthcare and a 41% decrease for Icade Promotion. We will have the opportunity to give you more details on our low carbon targets at our Annual General Meeting with the vote of say on climate and biodiversity. We will, in the meantime, submit our plus 1.5 degrees trajectory and methodology to the validation of SBTI from 2022 and onwards. It's a request of most of the intuitional investors. And with the midterm investment plan on low carbon of EUR 150 million, we are dedicating the appropriate level of financial resources to our [ EAC ] ambition. And return on investment for low carbon investments are also financially attractive. So a few words about the last topic, inflation. And since the beginning of the year, we have received a lot of questions about the potential impact of inflation on our results. As of today, what do we think about this topic. First, on revenues, 100% of our leases are indexed on CPI-related indexes. And second, on valuation with a cap rate at 5% for Healthcare, 5.5% on Offices for Icade portfolio. We have a risk premium that are at the very high level, not to say highest level. So with revenues that are also indexed, we have, in our view, a significant buffer to absorb sovereign interest rate increase. Having said also that we could have also a gap between sovereign rates and inflation. For the time being, cap rates on the market are stable for offices and still compressing for health care. Regarding financing, Victoire already commented on our very active and securing hedging policy. So as a conclusion, we do think that the impact of inflation will be limited, not to say positive on our portfolio. And a long time ago, and as I am much older than most of you, I remember that when I was at business school, I learned that real estate assets are among the best hedges against inflation. I don't think there is any reason to think that this is not a still valid economic theory. And to conclude with the guidance for 2022, so I'm on Slide 55 now. 2022 net current cash flow per share will be still well-oriented. We are expecting up plus 4%, excluding the impact of 2022 disposal. Specifically, the 2022 Healthcare division, Icade Santé, we anticipate an increase of the net current cash flow by plus to -- plus 5% to plus 6%. And finally, the 2022 dividend, subject to general meeting approval should be up by plus 4%. This guidance are subject for sure to sanitary situation that will remain stable, but things are well-oriented for the time being regarding that topic. So thank you for your attention. And we are now ready with the Executive Committee to answer all your questions. Thank you.

I don't know if we have a questions by [indiscernible] in the room. Florent, do you want to start?

Yes, please. So Florent Joubert from ODDO BHF. So thank you very much for the presentation. I would have 3 questions, if I may. So first question -- first question on Healthcare. The first one, so you have said that maybe we can expect more regulation in the near future. And my question would be as follows. So how shall we expect any changes in your financial KPI for Icade Santé. I don't know, maybe for, in terms of your ability to increase rents in terms of operational margins, for example? Second one, so maybe due to the nursing home's context. So do you see any changes in the investment market in Healthcare? And the third question is on Offices. So we have seen that your occupancy rate has decreased in 2021. So what can we expect in 2022, stabilization or increase of the occupancy rate?

Okay. On the 2 first questions on Icade Santé, Xavier, do you want to answer? I think you should withdraw your mask. Yes, it's better.

So on your first 2 questions about the KPI for leasing activity, what we expect is, I mean, in the very short term I would say everything is relatively frozen. And we all expect that coming from the government, additional reports will give a trend about possible new regulation and more transparency. So I would say nothing will change and we will remain fairly neutral. Regarding the investment market, maybe it's important to make a difference between what has occurred in France and what is occurring in France and what is occurring abroad. We haven't noticed any, I would say, side effects on neighbor countries about the nursing homes. It's relatively calm in Germany or in Italy, in Spain, about this ORPEA affair, which is focusing on the French market. So nothing to expect in that respect. A road in the French market, I would say, for now, maybe some cautiousness, but in the medium to long term, I mean, the demand is there. There will be a great need for additional infrastructure. So we remain very confident.

And maybe to add an additional comment, just to remind you that the private sector for nursing home in France represents 20% and all the private nursing home facilities are more or less full, that the number of elderly will grow by plus EUR 2 million if you look at 2030. So I don't know what will be the final outcome from the French government, but what we do see is that the private nursing home sector will continue, and we'll have to continue to grow just to face the demand, which is increasing significantly. And again, we are favorable to more regulation, more transparency, a bit like in the acute care sector. I think the reason, if you want to go into the detail, the reason why there is no public certification for nursing home in France, the reason is quite well-known. I'm talking ahead of specialists, but it's because public nursing home will probably have difficulties to reach the appropriate level of certification. So that's a point that the French government will have to take into account -- but some of you could be surprised by my conclusion on that. But at the end of the day, probably some positive trends will derive from this crisis. On the occupancy rate for Offices, Emmanuelle, what could we say?

Yes. Yes, about the occupancy rate of office portfolio, it will increase for sure in 2022, thanks to the letting of the rest of surfaces of the completed building in 1991, like Origine or Fresk. And exactly it takes longer time to lease the new building exactly like for [ Parc du ] in [ Leon ], it takes 1 year to let in and now it's almost fully let. And so we -- the occupancy rate is expected to increase in 1992.

Pierre-Emmanuel.

Yes, Pierre-Emmanuel from Kepler Cheuvreux. Just have 3 questions on Healthcare, 1 on Offices.

Could you speak little bit louder? Yes.

Yes. And just a question coming back on the point that made [indiscernible]. Can you remind us the occupancy cost ratio compared to the EBITDA for nursing homes? And it's clear that the profitability of private operators will most likely decline going forward. So are you expecting an adjustment of this occupancy cost ratio on [indiscernible].

Xavier will answer on cost ratio. Just on the question of how the rents could move, and just to remind you that the level of rent is mainly deriving from the level of the investment. At the end of when you build a brand-new nursing home, you apply a cap rate to the volume of the investment. If you do expect that you are to increase the level of investment within no single premises, our view, it's difficult to anticipate that rent will decline, and you will have to invest more. So if you want to invest more in nursing home, you will have to accept that rental values or rents for operators will grow. On the ratio that we are using to check the -- how do we manage our rents, Xavier?

Yes. So in the appendices on Slide 85, you'll find some figures. That's for the global portfolio. When we split these figures, so the EBITDA to rent ratio and the rent to turnover ratio for the nursing homes, especially, you'll find roughly the same figures for the EBITDA to rent. So close to 2, 2.0, meaning that the EBITDA is covering 2x the rent -- and for the rent to turnover, it would be above this figure, given the fact that, I mean, it's more residential on the nursing home business. So you'll be closer to 14%, 1-4% for nursing homes, 14% and 15%.

Coming back on your comment, Olivier, we can expect this EBITDA to rent ratio to decline as again the profitability of [indiscernible] operator might decline as well.

I think it's a bit too soon to see what would be exactly the final outcome in terms of regulation or new requirements. But just to remind you that maybe -- and this is one of the topic which is the most commented in the press, the number of nurses in nursing home of number of care assistant, those employees are not paid by the operators at the end of the day. They are paid by the French social security what we call the [indiscernible] in French which are local already. So the financing system remains the same, let's say, even if you increase the number of nurses, of care assistant within a nursing facility, it should not be impact too much the profitability of the operators. If you look at also another topic, which is quite described and commented in the press, backward margin and the volume of purchase by the operator. This is a system that exists for acute care operators, but it's transparent system. It's known by the health care authorities. And the profit is shared between acute care operators and the sanitary authorities. So you could also expect that the system will become the same for nursing operators, more transparency, what is -- what are exactly backward margin and how they are split between sanitary authorities and the operator. Again, public inquiries, I think they will be available mid-March or something like this. I don't know if the current government will take any measure. Just to remind you that we have a presidential election mid of April. So they will have 1 month to take any new measure for the nursing home system, or maybe it will be done by the new government after the election, we don't know. But again, I think the main thing that an evolution comparable to the acute care sector is probably the -- from our view, the central scenario that we have in mind.

All right. Just coming back on the ORPEA story. So would you be interested to buy your portfolio coming from ORPEA the LTV ratio of ORPEA close to 100%? Or is it too risky today to buy ORPEA assets?

I know if they have any -- if they are -- let's say they will have to launch first the public investigation. So let's see what will be the outcome of the public investigation. Again, it will be available mid-March. We will have to look carefully at what we have in those documents. After that, if they have assets for -- available for sale, we will -- for sure, we will look at that. ORPEA is one of our partners. We have made many transactions, 3 transactions with them in Germany and France. It's the worldwide leading operator. For sure ORPEA won't disappear. I don't know what will be the restructuration, what will the strategy of the new managing director, if there will be any financial restructuration, we don't know. So let's wait. But -- and we are, let's say, like this, we are proud of the premises that we have with them. And also what we build for Korian is state-of-the-art in terms of real estate specification for nursing home, and this will continue. And this will probably also improve again after this controversy. So I think that there will be, as we said, there will be probably not only for Icade Santé, but maybe for colleague and friend of Cofinimmo or [ Edifica ]. There will be probably some real estate opportunities deriving from that crisis.

Okay. That's clear. And a final question on the Healthcare segment. So it's on the IPO of Icade Santé. This story had a consequence as a large rating of peers. So just coming back on Icade Santé specifically, can you give us more colors on the timing? Can we expect an IPO in H1 and obviously the pricing? So can we consider that the former range for the valuation of Icade Santé is gone now? Can -- are you expecting…

As you could -- you are probably aware, geopolitics are a little bit complicated for the time being. And also we have this ORPEA case. So I have no more precise on for that, the one I gave. But for sure, it's not for April or May due to what is the geopolitic situation. And also we have to wait what will be the outcome of the nursing home controversy in France. After that, in terms of pricing, I don't know, maybe you have in mind or you have a look at the figures of the NAV per share of Icade Santé just to make sure that there is no confusion. So -- and believe me, the 5% like-for-like growth of the valuation of the portfolio, we didn't push external appraisers. I really do think it's still a bit conservative. Last September, our range was -- the lowest point of the range was a premium of 30% on NAV. Market has changed. So I don't know, for the time being, it's a bit too soon. For sure we are looking carefully at the evolution of the share price of our Belgium colleagues. They have been impacted by the ORPEA case. Let's see what will be the situation in June and July to make maybe the final decision. Sorry not to give you a more precise answer.

All right. And what about the liquidity close that you have with our minor shareholders, are you renegotiating?

Yes, yes, we have always the same, but we are fully aligned with our minority shareholders. And if you -- if we have to extend this liquidity close, I do assume that we will have no difficulty to do. So for those, we are not aware of that. It's by the end of 2022.

All right. And a final question on Offices. So I saw that your like-for-like growth deteriorated in H2. So is it entirely due to an increase of the vacancy? Or maybe can you give us also the reversion that you achieved in H2 for offices?

In fact, as I said, if you look at -- well, you don't have the detail, but if you look at assumption taken into account by external appraisers in terms of cap rates, it's more or less stable, bit stable, let's say like this total. So the difference comes from their assumption. It's not on vacancy. It is their assumption is for relating assumption that they take into account. So the -- as Emmanuel said, external appraiser, they do think that, and it's probably the reality. It takes longer to market new schemes and new promises. And they could have also a slightly more conservative view on rental value. So the difference is coming -- or the evolution is coming from relating assumption and not from cap rate evolution.

I was more referring on the rental revenues. The like-for-like growth have been largely negative in H2. Is it…

We have renewed significant leases, especially the one with our most important tenant in Nanterre, AXA, not to name them. And as it was in 9 years, all lease with indexation, renegotiation. This is the main reason for the negative evolution like-for-like rental revenues. In our view, it's a very good news that we have now AXA for another 9 years. And this is no impact on the final valuation of the asset because what you lose on the one hand from rental revenues, you have -- as you have a brand-new 9 years lease without a break option. It gives you a better cap rate on the building. But that's the renewal, which is the main explanation of your -- of the evolution negative in H2. Do we have questions on the line or by e-mail?

Our first question comes from the line of Alvaro Soriano from BNP Paribas.

Just few ones on my side. The first, maybe do you think investors will be more careful in the underwriting of nursing homes and also will input higher risk premium on the business. On that line, Icade will change the kind of underwriting approach, especially for nursing homes in France going forward?

Xavier, do you want to answer it?

Thank you for your question. So I mean, as I said, in the short-term we are all waiting for the release of the report from the government. Does that change our appraisal of the sector, I would say, no, in terms of fundamentals. So we are all aware that the population is aging. Olivier was reminding you that we expect EUR 2 million plus elderly people probably need for care in the coming years. So that's a huge number, and it will require additional facilities. So I mean, real estate capital. We expect more transparency probably coming out of the report. We don't know yet, but that's -- it's fair to assume that -- and then it will lead to, I would say, a more investor-friendly environment even more than it is today. So once again, something positive, I would say. And then in terms of counterparty, I would say it's something we need to assess in the coming weeks and months, depending on what would be the reaction of these groups, but they are large. They are running facilities. They have a huge cash and balance sheet, cash position and balance sheet. So I would say we are fairly confident. Then maybe to comment on the ESG factor, I would say, for the investors that are the most familiar with the sector, it's something that can occur. And I would say we are all aware of that kind of potential issues in the sector. So issues with human resources, issues with potential mistreatments in the facilities. That's an operating topic, not for real estate investor. But I would say that more light put on that and remedies put into action in the future would be an improvement overall in the sector.

Okay. And then also on the IPO, if finally Icade Santé listing is unsuccessful in 2022 for whatever reason, what sort of additional cash injection would need from Icade Group to support the growth ambition in 2023 and 2024. Is that on a scenario we should contemplate? Or there is enough room on the balance sheet of Icade Santé to continue falling growth in the coming quarters and years?

I will answer the question, but things are moving, but we do anticipate to invest EUR 600 million per year, assuming that we will be able to do so. Due to the level of leverage of Icade Sante, we find that between 50% to 60% leverage and 40% to 50% equity. And we have a stake of 58% of Icade Santé. So if you use those 3 numbers, you have the answer to your question. If you calculate quite quickly, it's something that is probably between, let's say, EUR 125 million, EUR 160 million. So it doesn't impact that much the balance sheet of Icade Group the end of the day. That's why we said we have the capacity, as you could have seen, to finance the growth for 2021 and also for 2022.

Okay. And you seem to be quite confident in the listing of Icade Santé because finally you are proposing 100% cash dividend. So it seems that on the balance sheet and liquidity side, the group is confident in all the targets including the IPO in 2022 to happen, right?

We do think it's the right future for Icade Santé, to be listed, I'll say like this, because this company will be for sure be the leading player of the sector. So I think it's really -- the positive, let's say, like this, is not end of the story, but future for Icade Santé is to be listed probably more autonomous related to Icade. So that's what we have. We try in 2021, we have to postpone. So let's see what is the situation in 2022. But this is still the -- to be listed, to be the goal that all our shareholders of Icade Santé have in mind.

Our next question comes from the line of Charles Boissier from UBS.

I just have an additional question on health care. Lots of good questions from my peers. And I just was wondering, so historically short-term stay traded at higher yields than long-term stay. I think something like maybe 100 basis points higher risk premium in France. So I just was wondering, is there a positive scenario for you where this premium could change in the future and healthcare investors in France which we are focusing more generally on the nursing home could be looking a bit more at short-term stay? Or is it a completely different type of investors and more technically intensive, and as a result you don't really see maybe a positive move from investment into more of the short-term stay?

I think it's fair to remind that we have always said that the difference in terms of cap rate between acute care and nursing home was surprising for us because when you look into the details of what are the assets, we already saw that this difference of -- that could have been close to 100 bps was some kind of a mispricing of acute care asset. And it was the initial investment theory of Icade Santé. We have always sticked to that. And we have seen last year, things started to change. Believe me, in the 2 acquisition that we have made in Italy and in Portugal and also some in France, we have seen that they are now really motivated competitors that are now also as we were that are fully convinced that there is no obvious reason to have such a difference. So I don't know if it will occur, but I think that the midterm evolution could be to see less different between cap rate of nursing home and cap rate of the acute care segment. That will be probably for Icade Santé a good news. But it's clearly what do we think in the acquisition that we have made in Portugal, competition was strong. I think we had, at the end of the day, an attractive price because we were able to close the transaction very, very quickly just before the end of the year last year for [indiscernible] that has started in September, but we had competitor. So we do see a cap rate compression for acute care. That should be over the next 2 years, probably stronger than for nursing home sector, apart from the ORPEA case. But I think that's probably the trend of the market for the near future, yes.

Our next question comes from the line of Veronique Meertens from Kempen.

I just had some questions for the guidance, just double-check. So it's excluding the impact of '22 disposals, but is it also excluding optimistic acquisitions? And then maybe on the dividend guidance of 3% to 4%. Is this also excluding this process or at least -- I mean disposals? In other words, does the payout ratio go up then if you assume disposals of EUR 500 million to EUR 600 million a year?

Victoire, do you want the question -- answer the question?

Yes. Of course, the sound is not good, but I will try to answer to you. For the first question, the guidance on net on net current cash flow, plus 4%. It's excluding disposal, but of course it's including if we have in 2022, opportunistic acquisition. I heard Icade is part of the question. On the second guidance, the dividend guidance, it's also -- it's including disposals. So it's based on the total cash flow.

And the reason for that, maybe just to remind you, that we have a specific tax regime, and we have to distribute part of the cash flow, but also part of the capital gain on capital gain deriving from disposal. That's why we could use 1 of the 2 pockets, one coming from the cash flow, one coming from the capital gain to distribute the dividend. As Victoire said, the -- our dividend policy, which will be plus 3%, plus 4% next year, include everything or…

Okay. Perfect. That's helpful. Maybe one last question, speaking of offices and actually more specifically of the business park, could you maybe elaborate what you're seeing there in the market in terms of investor appetite, but also what you expect in rent levels and reversion rates for that part of the business?

Sorry, I didn't catch your question. Could you just repeat?

Yes, for the business parks, I was wondering if you could elaborate what you're seeing in the market in terms of investor appetite and also in terms of rent levels and incentives.

On business park and especially labs and premises for small businesses, as you could have seen, the valuation move in 2021 was really strong and positive, plus 11% for the part of the business park, what you probably have in mind that really business park. So the demand is really strong and [ Emmanuelle ] and the team, they have closed a lot of transaction. So we really do think that this part of the portfolio should continue to perform quite well in 2022. We have, I think, appealing requirement from potential new tenants in the pipeline. So it's our job to transform, but it's clearly a segment which is performing quite well. Not impacted, for sure, by remote work or work-from-home because what you do have in this kind of premises, it's clearly the kind of activity, the kind of business that you can't do from home. Maybe Thierry, you could take one last question if we have one.

The question comes from the line of Stéphane Afonso from Invest Securities.

I have 2 questions, if I may. So the first one on the OP division. So I understand that the reversion was negative this year. So is it possible to have an idea of your reversion potential to capture? And the Healthcare division. So do you intend to adapt your allocation strategy, especially in terms of acquisition between long-term care and acute care? And finally, on the Property Development Division, could you elaborate a bit more on the evolution of your market share in terms of orders since 2019?

We'll answer -- if I may, I think for the second, we have already answered, but Xavier could come back to that again, if you want. Emmanuel, do you want to answer the evolution of new orders for Icade Promotion and market share, how do you see the market? And after Emmanuel on the reversion on our office and business park portfolio.

We are quite confident in the future for Icade Promotion, with a good year in permit buildings. We have obtained 7,300 building permits flat. It's a good target for the future. It's a leading indicator that we'll be able to increase our commercial offer. And it's a good thing in a market, in a strong market with a good demand about the family, for example.

So just to summarize the question, and you have seen how Icade Promotion has performed. But clearly, the question is not the demand, it's your capacity to renew your supply, especially by getting new building permits. And we have been, I think, quite successful by that with a significant increase in terms of building permits that were granted to Icade Promotion. That's good news for the future. On the reversion potential, Emmanuelle.

For the reversion potential. This year, we signed and we knew the level of the estimated rental value. But of course we noticed a negative reversion between this new level of rent for the renewals and the former rent, level of rent explained by the indexation. So when we renewed, we renewed at a lower rent, level of rent. So we have a small negative revision for the renewals.

Thank you, Emmanuelle. Thank you, everyone, for having attended this presentation. If you have any general question, do not hesitate to send them to Anne-Sophie and the Investor Relation team. We'll be more than happy to answer you. And the next meeting altogether will be our general meeting in April. Thank you very much.